Energy Future Holdings Corp. canceled plans to auction its valuable power-distribution business and will try to resolve its $42 billion bankruptcy under one of two proposals backed by rival groups of creditors, Bloomberg News reported today. Unsecured creditors backed by Hunt Consolidated Inc. are trying to round up enough senior debt-holders to push through a reorganization plan worth about $19 billion. If they succeed, Energy Future would seek court approval of that plan in October. If Hunt can’t reach consensus with investors who lent money to Dallas-based Energy Future’s power-generating business, the bankrupt company would proceed with a proposal supported by creditors led by Fidelity Investments. Both groups proposed raising billions of dollars to pay down debt through a sale of shares in a reorganized Energy Future. Energy Future filed its $42 billion bankruptcy last year with a plan to break itself in two, giving each part to different sets of creditors. Groups that felt left out of that proposal have been fighting since then.
